Pay your medical bills with tax-free contributions into a Health Savings Account
A Health Savings Account (HSA) is a tax-exempt custodial account that you set up with a qualified HSA custodian/trustee to pay or reimburse certain medical expenses.
You are eligible for an HSA, if you:
- Are covered under a High Deductible Health Plan (HDHP) on the first day of the month;
- Are not also covered by any other health plan that is not an HDHP (with certain exceptions for plans providing preventive care and limited types of permitted insurance and permitted coverage);
- Are not enrolled in Medicare; and
- You cannot be claimed as a dependent on someone else’s tax return
How It Works
Deposits to an HSA may be made by any policyholder of an HSA-eligible high-deductible health plan, by the employer, or any other person.
Contributions from an employer or employee may be made on a pretax basis by an employer. If that option is not available through the employer, contributions may be made on a post-tax basis and then used to decrease gross taxable income on the following year’s Form 1040.
All deposits to an HSA become the property of the policyholder, regardless of the source of the deposit. Funds deposited but not withdrawn each year will carry over into the next year.
The Internal Revenue Service has established limits for the maximum annual contribution to an HSA. Additionally, a “catch-up” contribution is available for eligible individuals who are age 55 or older by the end of their taxable year and have not enrolled in Medicare.
All contributions to an HSA, regardless of source, count toward the annual maximum.
The deadline for regular and catch-up HSA contributions is your federal income tax return due date, excluding extensions, for that taxable year. The due date for most taxpayers is April 15.
HSA participants do not have to obtain advance approval from their HSA trustee or their medical insurer to withdraw funds, and their funds are not subject to income tax if they are made for qualified medical expenses. If you receive distributions for other reasons, the amount you withdraw will be subject to income tax and may be subject to an additional 20% tax. You do not have to make distributions from your HSA each year. Unused funds will carry over to the next year.
Reporting HSA Activity to the IRS
Each year, your HSA custodian/trustee reports your contribution and distribution activity to the IRS using IRS Forms 5498-SA and 1099-SA. In addition, you file IRS Form 8889, Health Savings Accounts (HSAs), as part of your federal income tax return to show your HSA activity.
Additional information on Health Savings Accounts may also be found by visiting www.irs.gov or by speaking with your tax advisor.
Enjoy the following benefits with a Health Savings Account:
- Tax-exempt deposits
- Deposits carry over year to year if not used
- Earn interest on your balance1
- Automatic transfers
- Online Banking
- Mobile Banking
- Paperless eStatements
Additional Account Details:
- No minimum deposit to open
- No minimum balance
- Interest is compounded and credited monthly
- Interest is computed using the Average Daily Balance2
- Monthly statements
- Interest rate is tiered
- Account access is via Visa debit card
- Early closure fee: $25 if closed within 180 days of account opening
1The interest rate is a variable rate and we may change the interest rate on your account at any time.
2The Average Daily Balance method applies a periodic rate to the average daily balance in the account for the period. The average daily balance is calculated by adding the principal in the account for each day of the period and dividing that figure by the number of days in the period.
Manage your account with our electronic banking services
Manage your account from anywhere Internet is available.
Do your banking on the go with our CSB Mobile app.
Check your balance with a simple text message.
Use email and text alerts to monitor your account and help prevent fraud.